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Friday, May 11, 2012

SF TO DEVELOP NEW B 3 BN BANGKOK MALL


SF Cinema City Co, the operator of the SF cinema chain, is branching out to develop its first retail complex in Bangkok at a cost of 3 billion baht.

It believes the retail areas will help its cinema operations.

President Suwat Thongrompo said the first retail complex will be built on a plot covering 12 rai in central Bangkok. The development will have saleable space of almost 100,000 square metres and is scheduled to open next year.

Mr Suwat said funds will come from its equity and bank loans.

The shopping mall is expected to create several hundred new jobs and house 150 tenants, he said.

SF has run its cinema business for 45 years before deciding to diversify to development.

"There are only two or three locations in Bangkok operating our cinemas. It will take many years for SF to cover more provinces, so building our own retail development can accelerate expansion," he said.

Demand for retail rental space is quite strong, but developers only develop a few projects a year, leading SF to believe it has room to grow in the market.

"As we are a new player to retail, our development plans will be unique. We plan to develop more retail projects in other prime locations," Mr Suwat said.

He added location will be more important than quantity of stores in its development scheme.

SF is the second-largest cinema chain in Thailand with almost 200 screens in 27 locations across the country.

The company plans to spend another 1 billion baht this year to open six new theatres, one each in Ubon Ratchathani, Surat Thani, Maha Sarakham, Lampang, Udon Thani and Lop Buri.

Sales of SF this year are expected to grow by 20-25% to 3 billion baht, higher than last year, because of a full year operating at Terminal 21 and Central Plaza Rama 9.

Movies such as The Avengers, The Amazing Spider-Man, Men in Black III, a new James Bond film, King Naresuan 5 and another Twilight are expected to help receipts.

Mr Suwat said SF's business has been affected by the minimum wage hike. The higher wage means a 10% rise in overall operation and management costs, so it is considering raising ticket prices by 10-20 baht.

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